Layoffs Muted Despite Stalled Hiring
By Reuters | 06 Oct, 2025

The number of jobless claims went up modestly in the final week of September but hiring appears to remain stalled on uncertainty over Trump's tariffs and migrant deportations.

A “Help Wanted” sign hangs in restaurant window in Medford, Massachusetts, U.S., January 25, 2023. REUTERS/Brian Snyder/File Photo

The number of Americans filing new applications for unemployment benefits increased marginally during the last week of September, data from Haver Analytics showed, pointing to a still low level of layoffs even as hiring has stalled.

Initial claims for state unemployment benefits increased to a seasonally adjusted 224,269 for the week ended September 27 from 218,589 in the prior week, Haver Analytics calculated.

Official data collection and publication has been suspended because of a government shutdown, now in its sixth day. But states have continued to collect unemployment claims data and submit it to Labor Department's database, which remains accessible. The shutdown following a lapse in funding has delayed the release of the closely watched employment report for September, crucial for decision-making by officials at the Federal Reserve, businesses and households.

The labor market has stagnated with businesses not firing employees on a large scale, but also reluctant to hire more workers. Economists have blamed the labor market paralysis on President Donald Trump's trade and immigration policies as well as the growing popularity of artificial intelligence, which have combined to reduce demand and labor supply.

   Government data last week showed there were 0.98 job openings for every unemployed person in August compared to 1.0 in July. With hiring sluggish, more people are experiencing long spells of unemployment and remaining on benefits for longer.

The number of people receiving benefits after an initial week of aid, a proxy for hiring, increased to 1.921 million during the week ending September 20, from 1.916 million in the prior week, Haver Analytics estimated.

(Reporting By Lucia Mutikani, Editing by Franklin Paul)